Digital merchants don't necessarily have to open a store, but they can still benefit from the tactics of brick-and-mortar retailers, according to David Schwartz, vice president of e-commerce at Wix, a Tel Aviv-based technology company.

One such example is the popup presence. Many small merchants that want to strengthen their presence in their community will buy a booth at local fairs and other events, and digital merchants have the same opportunity.

"The first thing I do when I want to make an impression on clients is to talk to users," Schwartz said. "I speak to users everyday. There's enormous value in getting out there."

Wix has a base of about 300,000 merchants that use its web development platform, and its new integration with Square — announced early Tuesday — will enable these merchants to engage their clients face-to-face.

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There are competitive plays for both companies. For Square, the collaboration opens up thousands of potential new clients, given that most of Wix's merchants do not offer Square presently — but have asked specifically for Square's product, according to Schwartz.

Since Square has been incrementally adding more merchant services as it turns its focus entirely on acquiring and away from consumer-focused payments, a windfall of new merchants would certainly be welcome.

Square initially offered its hardware for free, and has been adding merchant services over time to diversify its business model. In the past year, Square has executed a marketing program in Portland, a city with a high percentage of micro merchants, offered same-day deposits for merchants and installment plans for chip card hardware.

It has also inked partnership deals with Vend and TouchBistro, two companies that offer inventory management and other merchant services.

The new partnerships, which follow an older Square pact with Starbucks that ended poorly, give Square an opportunity to scale quickly by relying on an outside party to acquire merchants.

“Wix allows any seller to run an omnichannel business,” said Pankaj Bengani, Square’s partnerships lead, in an email. “By integrating with Square, businesses can track sales data and manage inventory both online and in-person in one place, making it easier to make smart decisions to grow their business.”

For Wix, it's battling a growing number of third-party services that build web gateways for merchants, particularly in the micro-merchant market—including WebyDo, SiteSumo, EasyWebContent and many others.

"The need for point of sale for these merchants is very clear," Schwartz said. "If you're taking orders and payments on a website, how do you compete for customers offline?"

Wix's merchants can use the company's drag and drop editor to add Square acceptance alongside other tools such as order management, promotional features, tax and shipping rules.

There are no fees beyond the fees Wix and Square charge independently. Square is Wix's first mobile point of sale integration, though Schwarz said the company would likely pursue relationships with other mobile payment providers, particularly in markets where Square does not have a large presence. The Wix/Square integration at the onset is targeted primarily at the U.S. market.

"These merchants all want to have seamless processing," Schwartz said. "We cannot promise sales, but we can make it easier to set up."

Companies have made attempts to bridge the gap between digital and in-person payments before, said Ben Jackson, director of the prepaid advisory service at Mercator Advisory Group.

"It is interesting because Amazon has opened brick and mortar stores that appear to be permanent installations," Jackson said. "Amazon Go is letting people buy things without any formal checkout process. The question is whether other online retailers can or need to follow suit...it seems as though more online merchants are trying to curate content around their brands, and so having in person events might offer a new avenue, especially for specialty retailers."

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